Many believe a new warehouse is the solution, but is it? Most of the time, optimizing your current space is a better option.
You can improve efficiency and capacity without the costs of building or relocating.
Watch the video below to learn how to make the most of your existing warehouse.
Is a Bigger Warehouse Really Necessary?
Are you sure that a larger warehouse is the solution to your space issues? This week, we’re diving into this question. At Logistics Bureau, many companies come to us believing they need more space when their current warehouse seems to be bursting at the seams. After 26 years in the industry, I’ve observed that expanding to a bigger warehouse is a common response as businesses grow. But is it always the right choice?
Before you commit to moving, it’s essential to evaluate whether it’s truly necessary. We’ve assisted many clients in optimizing their existing warehouse space, avoiding the substantial costs and disruptions of relocating. It’s worth considering if minor changes could resolve your space issues.
Inventory Management: A Key Factor
Running out of space often stems from holding excessive inventory. The pandemic led many businesses to increase stock to cope with supply chain uncertainties. Now that conditions have stabilized, some companies still hold more inventory than needed. Review your stock levels and identify slow-moving items that could be reduced or eliminated.
Balancing inventory is crucial. Many businesses overstock low-demand items while understocking high-demand products. A thorough analysis can help you balance inventory, optimize space, and reduce excess.
Maximizing Warehouse Layout & Process
Sometimes the issue isn’t the amount of space but how it’s used. We’ve seen clients increase warehouse capacity by up to 30% with simple changes, such as narrowing aisles and switching to more efficient forklifts. These adjustments can help you make the most of your existing space without relocating.
Consider layout optimizations like adding mezzanines or reconfiguring storage systems. These changes can extend the usefulness of your current warehouse. Before deciding to move, thoroughly evaluate your space utilization.
Your picking process can also impact space efficiency. Inefficient picking methods may waste space and slow down operations. Revising your methods or adopting new technologies can improve efficiency and free up space, potentially delaying or avoiding the need for a larger facility.
Considering the Costs and Disruptions of Moving
Relocating a warehouse involves significant costs and disruptions. The expenses of moving and the operational downtime during the transition can impact your business. It’s crucial to explore all alternatives before deciding to move.
Outsourcing warehousing to a third-party logistics provider might offer the flexibility and scalability you need without investing in a larger facility. However, weigh this option carefully against the costs and potential loss of control over your operations.
To get the full scope of this topic, watch the video above.
Related articles on this topic have appeared throughout our website, check them out:
- Are You Sure You’re Out of Warehouse Space?
- 10 Proven Principles for Best Warehouse Design and Operation
- Improve your Warehouse Productivity Through Product Slotting
- Warehouse Product Slotting: The Ultimate Guide
- A Recommended Approach to Warehouse Layout and Operational Design
Editor’s Note: The content of this post was originally published on Logistics Bureau’s website dated August 16, 2023, under the title “Do You Really Need a New Warehouse?“.
